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Tullow Oil's Ambitions in Uganda Entangle Company in Land Dispute

By

Nicholas Bariyo

Updated Dec. 23, 2010 12:01 a.m. ET

HOIMA, Uganda—A battle is brewing over oil-rich land licensed by Uganda's government to
Tullow Oil
TUWOY -2.80%
PLC, entangling the U.K. company in a conflict between nomadic livestock herders and indigenous communities.

Uganda's army has begun enforcing an order by President Yoweri Museveni, above, to remove herders from oil-rich land licensed by Tullow Oil.
European Pressphoto Agency

In recent days, Uganda's army had begun enforcing an order from President Yoweri Museveni to remove the herders. They were forced off the land with about 10,000 head of cattle and not provided with an alternative place to settle, according to security officers in the Bulisa and Hoima districts.

Ugandan police say they have arrested at least a dozen herders resisting eviction.

But on Thursday, the high court in Masindi provided a temporary reprieve, halting the evictions until a March hearing. About 640 families are living on a 30-square-mile stretch of land.

A lawsuit filed on behalf of the herders poses a challenge to Tullow's plans to begin developing its Kasamene oil discovery in Uganda's Lake Albert Rift Basin. Tullow says it plans to compensate whoever owns the land but says the license allows the company to continue with exploration regardless. The area boasts an estimated 800 million barrels of recoverable oil reserves, and Tullow expects to begin oil production in the fourth quarter of next year.

"Tullow would like to operate in an environment free of tensions," says Tullow Uganda Ltd. spokesman
Jimmy Kiberu
"The presence of these pastoralists had started causing conflicts with the local communities," he added.

Ambiguous Ownership

The legal spat echoes similar conflicts over land and resources in other developing countries, from Africa to Asia. Governments sometimes sell land to companies where local farmers have lived for generations, with or without any record of property ownership.

In Uganda, oil production could sharpen land disputes and heighten social tensions if the government doesn't improve the clarity of property rights and help those left on the margins of the energy boom.

"For many years, the government has not allowed us near this forest, but now foreigners are comfortably occupying it," says
Joseph Alisemera,
a farmer from the Banyoro tribe in the Kabwoya area of Hoima district who lacks a title deed to his 7.5-acre piece of land. "All we have been seeing in the past two years are trucks and white men," says Mr. Alisemera, standing in his mud-and-wattle house.

Like many other indigenous people in the area, Mr. Alisemera said he inherited his land from his ancestors. Yet with the discovery of oil and an influx of cattle herders, his hold on the land is threatened. Many herders have acquired title deeds in an effort to bolster bids for compensation if they are asked to leave.

Last week's evictions followed a November clash in which police raided military-style camps of former soldiers who had moved into the remote Bugoma Forest, in another part of the Lake Albert Rift Basin. Police fired warning shots and arrested 11 people, but roughly 300 ex-soldiers remain in the forest, says a Uganda police spokeswoman. Security officials say they were trying to avoid a situation similar to Nigeria's Niger Delta, where militants have destroyed oil infrastructure and carried out kidnappings and car bombings.

Restoring Order

Uganda's government says the occupied oil land in Tullow's Block 2 license is communally owned and that the herders who settled there in recent years have squabbled with communities that have inhabited the land for many years. Tullow is caught in the middle.

Attorneys representing the Bulisa herders say their clients have title to the land they inhabit.

"The president is trying to restore order," says President Museveni's spokesman, Tamale Murundi. "Government cannot tolerate a group of people who just roam the whole country with cattle."